[P]inning a value to Trump’s buildings is a guessing game.
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Appraisers and commercial brokers warn that it is difficult to know how much his assets are worth, with numerous variables at play, including his debts.
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Here is a look at the challenges that the state faces as it tries to seize, or even pin a value, on some of Mr. Trump’s best-known properties in Manhattan.
Who Really Owns It?
Mr. Trump does not own almost any of his properties outright. They are protected by a maze of interlocking trusts and limited liability companies. According to the lawsuit, there are as many as 500 separate entities that operate for the benefit of, and under the control of, Mr. Trump.
This creates a challenge for the court, bankruptcy experts said.
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The Fine Print
For some of the buildings, the ownership structure is so complex that it becomes unclear what, if anything, the court could seize.
Take the sleek skyscraper at 1290 Avenue of the Americas. Nearly two decades ago, Mr. Trump acquired a 30 percent stake in an entity that owns the 43-story building in Midtown Manhattan adjacent to Radio City Music Hall. The other 70 percent is owned by the Vornado Partnership Trust.
The fine print of the partnership makes it difficult, maybe even impossible, for Mr. Trump to sell his 30 percent stake. Initially set to expire in 2044, the partnership states that “a partner may not, directly or indirectly, sell, assign, transfer or otherwise dispose of any part of their partnership interest, without prior written consent from the majority owner,” according to an excerpt from the agreement shared during the trial.
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Now, if the same asset is seized, the state will face the same limitations that they uncovered during the trial — namely that he is more or less stuck in this partnership for another two decades, said real estate attorneys.
Owning Not the Building But the Right To Rent It.
…40 Wall Street has long been one of the marquee properties in Mr. Trump’s portfolio…In 1995, for $1.3 million, Mr. Trump bought the right to lease it, according to court records. An offering memorandum for the building shows that the agreement lasts for nearly another two hundred years, until the year 2194.
That’s right — the right to lease it. He is not the owner of the building or the land under which it sits. The arrangement, known as a “ground lease,” makes selling it harder, say real estate lawyers and commercial brokers.
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In 2010, 2011 and 2012, three different appraisals by Cushman & Wakefield valued his leasehold at between $200 and $220 million, if it were to be sold as is, according to documents that were made public during the lawsuit. In 2015, a lender-ordered appraisal valued it at $540 million.
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The value of the lease is a function of two things: how much Mr. Trump is paying in rent to the building’s owner and other expenses, and how much he is earning in return from the dozens of tenants occupying the skyscraper.
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